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Groupon IPO

November 4, 2011 Leave a comment

It is 12:30PM, November 4, 2011 and the Wall Street Journal reports “Groupon Opens Up 40%” The current price gives Groupon a market cap of around $13 billion. However, the company is stillĀ hemorrhaging money. There are probably a few reasons why the stock is up – 1.) the size of the offering is a very small percentage of the company, 2.) there is plenty of hype, 3.) internet IPO’s usually get strong demand.

Now, what is important about this is to stick to the fundamentals. As I wrote before,

All in all, I see Groupon as a poor investment.

Nothing has changed since my last post, and given the currentĀ trajectory, I am sticking to my position. Time (and I suspect a very short time) will tell.

 

*This article is not financial advice, nor is intended to recommend the purchase or sale of any stock or investment. Please consult your financial advisor for investment guidance.

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